The S&P 500 started out this century priced at $1,441.47. By Dec. 4, 2017, it had risen to $2,646.68, for a cumulative 17-year return of 83.61 percent.
It’s easy to forget the volatility of the market after the nine-year upward run the market has had. Since 2000, investors have endured the bursting of the technology bubble, which began in March 2000 and bottomed out in September 2002, and the mortgage meltdown and recession in 2008 and 2009 — both unfriendly reminders that stocks are volatile.
The fast-growing stocks, listed here, however, beat the market by wide margins. If only you had a crystal ball 17 years ago to ferret out these stocks that have since soared to incredible heights.
10. Celgene Corp. (CELG)
Jan. 1, 2000 price: $2.91 (reflecting subsequent splits)
Dec. 1, 2017 price: $102.14
17-year annualized growth rate: 23.28 percent
Value today of a $1,000 investment 17 years ago: $34,100
This biotechnology company treats cancer and inflammatory diseases worldwide. Even though the stock is well down from its 52-week high of $147.17, Celgene still makes it onto the list of the fastest growing stocks of this century. The reason you’ll see a couple of biotech stocks on this list of top performers is because the category slammed the returns of the S&P 500 during the last five years. With increasing new biotech drug launches there are greater treatments and cures for many diseases. The recent stock pullback and a forward price-earnings ratio of 12 make CELG attractive. The company also has a deep pipeline of nine new drugs, including those that treat ulcerative colitis and multiple sclerosis.
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9. DaVita HealthCare Partners Inc. (DVA)
Jan. 1, 2000 price: $1.54 (reflecting subsequent splits)
Dec. 1, 2017 price: $61.11
17-year annualized growth rate: 24.18 percent
Value today of a $1,000 investment 17 years ago: $38,862
Another healthcare player, DaVita HealthCare operates dialysis centers that serve individuals suffering from chronic kidney failure or renal disease. DaVita considers itself the standard bearer for global kidney care. Showing no signs of slowing down, the company recently announced the acquisition of Northwest Physicians Network (NPN), a Pacific Northwest independent physician association. Warren Buffet’s Berkshire Hathaway is a prominent shareholder in DVA and the Motley Fool recently recommended the stock. The aging population should assist DaVita’s future growth.
8. Ventas Inc. (VTR)
Jan. 1, 2000 price: $1.44 (reflecting subsequent splits)
Dec. 1, 2017 price: $64.81
17-year annualized growth rate: 25.10 percent
Value today of a $1,000 investment 17 years ago: $44,007
Ventas is a real estate investment trust that buys, manages, finances and leases properties in the healthcare industry. The company focuses on hospitals, skilled nursing facilities, senior housing and other healthcare-related facilities, and has benefited from the aging population. It recently was honored for a second time with a National Association of Real Estate Trusts (NAREIT) “Leader in the Light” award. Additionally, Ventas is recognized as a “Winning Company in the 2020 Women on Boards Gender Diversity Index.” Despite the accolades, Ventas might not be ripe for purchase today with a one-year price target of $64.88. On the plus side, the 4.84 percent dividend makes Ventas the best dividend stock on the list.
7. Apple Inc. (AAPL)
Jan. 1, 2000 price: $3.32 (reflecting subsequent splits)
Dec. 1, 2017 price: $171.05
17-year annualized growth rate: 26.10 percent
Value today of a $1,000 investment 17 years ago: $50,521
Apple, which needs no introduction, beat out omnipresent Amazon as one of the top stocks of the century. With a market cap above $870 billion and worldwide brand recognition, Apple has a seemingly insurmountable moat. Even so, with 45 percent year-to-date stock price growth, there’s talk about whether Apple’s tremendous success can continue. In fact, expectations are tempered from the current year’s 24.20 percent growth to 10.70 percent over the next five years. There are a couple of reasons to consider still investing in Apple, however. It has a forward P/E ratio of 14.5, which is below the Nasdaq’s 21.5 multiple. And Apple offers a tasty dividend yield of 1.47 percent.
6. Activision Blizzard, Inc. (ATVI)
Jan. 1, 2000 price: $1.19 (reflecting subsequent splits)
Dec. 1, 2017 price: $61.96
17-year annualized growth rate: 26.18 percent
Value today of a $1,000 investment 17 years ago: $51,067
This multimedia and graphics software company develops and publishes video games. AVTI’s stellar growth is due to its high standing in global gaming and ownership of several top franchises. This month, “Call of Duty WWII” earned $500 million in worldwide sales during its three-day opening weekend. Several of Activision’s games are listed on Yahoo’s 2017 best games of the year list. With a one-year price target of $71.44 and gaming demand continuing, keep an eye on this top stock.
5. Gilead Sciences Inc. (GILD)
Jan. 1, 2000 price: $1.38 (reflecting subsequent splits)
Dec. 1, 2017 price: $75.34
17-year annualized growth rate: 26.53 percent
Value today of a $1,000 investment 17 years ago: $53,594
Thirty-year old Gilead was a superb performing stock this century and might also be one of the best stocks to invest in now. This California biotech serves the world with medicines to treat HIV/AIDS, hypertension, hepatitis and other conditions. Gilead’s rapid growth is partly due to the fact that its lineup includes some of the top medicines to treat and cure their respective diseases.
Gilead is still a good investment choice. With a low of P/E ratio of 8.05 and a buy recommendation from the Motley Fool, Gilead has a full pipeline of prospective treatments and cures.
4. Ross Stores Inc. (ROST)
Jan. 1, 2000 price: $1.35 (reflecting subsequent splits)
Dec. 1, 2017 price: $75.73
17-year annualized growth rate: 26.73 percent
Value today of a $1,000 investment 17 years ago: $55,096
For the past 11 years, Ross Stores’ stock price has been raging. Rising from $6 per share in June 2006, the stock currently sells near $76. Over the past 52 weeks, Ross shares have surged 43 percent.
This discount retailer typically sells name brands at 20 percent to 60 percent off retail across 1,412 stores. Ross has thrived as cost-conscious consumers seek top quality brands. The Motley Fool considers Ross one of the top stocks to invest in for the long term as the company continues to expand its footprint. A recent report likes Ross’ increasing same-store sales, strong profitability and smart pricing trends.
3. Tractor Supply Company (TSCO)
Jan. 1, 2000 price: $1.04 (reflecting subsequent splits)
Dec. 1, 2017 price: $68.16
17-year annualized growth rate: 27.89 percent
Value today of a $1,000 investment 17 years ago: $64,538
If you live in a major city, you might not be familiar with this top-performing stock. Founded in 1938 as a mail order tractor parts business, Tractor Supply now owns more than 1,600 stores in 49 states. It’s the go-to store for home and land maintenance products along with supplies for pets and big animal owners. Serving farmers, horse owners, ranchers and rural populations, the company’s stock price success was propelled by new store openings and improving products. Tractor Supply Company hasn’t been closing stores like other retailers have been forced to do.
TSCO trades near the high end of its 52-week range of $49.87 to $78.25, and its P/E ratio is a reasonable 20.60. There is one risk, however: future stock growth could slow to 11.48 percent over the next five years, below the 13.79 percent growth rate of the last five years.
2. CarMax Inc. (KMX)
Jan. 1, 2000 price: $0.78 (reflecting subsequent splits)
Dec. 1, 2017 price: $68.38
17-year annualized growth rate: 31.10 percent
Value today of a $1,000 investment 17 years ago: $86,667
With the average price of a new car over $33,000, it’s no surprise that used car dealer CarMax, with 181 locations, is one of the fastest growing stocks. KMX earnings hit $3.26 per share in 2017. That was up from $3.03 the prior year and continued a years-long run of steady growth. With current quarterly share price growth of 12.5 percent and five-year growth projected to be 13 percent, CarMax is a good long-term play. On the downside, next year’s growth is expected to be only 6.5 percent.
1. Monster Beverage Corp. (MNST)
Jan. 1, 2000 price: $0.09 (reflecting subsequent splits)
Dec. 1, 2017 price: $62.92
17-year annualized growth rate: 47 percent
Value today of a $1,000 investment 17 years ago: $698,111
Monster Beverage was the stock to own on Jan. 1, 2000. After adjusting for splits, your thousand-dollar investment would have been worth more than $698,000 today. This energy drink holding company must have been drinking its own products to head up this list of highest performing stocks. With a stable of high octane energy drinks such as Full Throttle, Burn, Gladiator and Power Play, the company profited from consumers’ lust for more energy.
Hindsight is 20/20, however, and this awesome growth story isn’t a stock to buy today. The global trading firm Susquehanna recently downgraded the stock to a negative rating from neutral. Monster’s mid-double-digit growth doesn’t warrant a P/E ratio of 47.59.
It’s exciting to watch the explosive stock performances of these companies as they handily trump the returns of the S&P 500. But they might not be the best stocks to buy right now. Remember that before buying any stock, do your own research.
About the Author
Barbara Friedberg, MBA, MS, brings decades of finance and investing experience. She is a former investment portfolio manager. Friedberg taught Finance and Investments at several universities. Her published work includes Personal Finance: An Encyclopedia of Modern Money Management, Invest and Beat the Pros–Create and Manage a Successful Investment Portfolio, and How to Get Rich; Without Winning the Lottery.